How Seller Financing Benefits Professionals
In the current housing market, seller financing can be a blessing to those directly dealing with property sales or those whose clients are looking to buy or sell property. Seller financing represents an important alternative to traditional bank lending, as it gives the seller and buyer an opportunity to work out a repayment schedule that fits both parties’ needs. Even better, it means the sale can happen sooner.
Professionals in various lines of work will sometimes encounter clients that are note holders, i.e., those that have used seller financing to sell a property. Many note holders need or want to sell their note for extra cash, and may ask how this can be done. A client can get the money they need through a professional referral to a note specialist. And the professional can benefit from seller financing too!
Here’s how various professionals benefit from seller financing:
Real Estate Agents
Real estate agents that are familiar with seller financing have an edge in the housing market. When the housing market is strong, real estate agents do not usually need creative means to sell properties; however, when the market is declining or interest rates skyrocket, creative deal structuring becomes very important.
Hard-to-sell homes can be made available to entirely new markets through seller financing. And because the terms of the contract are arranged by the buyer and seller, the deal should fit the needs of both. Best of all, the sale of the property generally takes place sooner – benefiting the seller, buyer, and the real estate agent. The seller sells their home faster because they don’t have to wait for a buyer that has bank financing and the real estate agent gets a commission.
Title Agents
Title agents that are well versed in the tactic of seller financing also stand to benefit a great deal. Title agents can expect more deals to close faster because the buyer approval process is simpler than with a traditional lender. Additionally, many notes are later sold for cash, which could mean a second transaction, as it is common for the seller to go back to the same title company to close the note sale.
Attorneys
The need for legal advice is very likely for the buyer and seller using owner financing,
Understanding seller financed transactions can prove to be very lucrative for attorneys, as their clients often need legal advice regarding the structure of the sale, the contracts involved, and the specific clauses required to protect their interests.
On the other side of the coin, attorneys specializing in fields like divorce or estate planning may encounter clients with existing notes that require liquidation, so having resources ready to assist with these scenarios is equally beneficial.
Financial Advisors, Financial Planners, and CPAs
Real estate transactions are a fact of life for most clients seeking financial advice. Understanding seller financing is important in order to provide clients with every available option. While some are looking for creative ways to sell properties and avoid having to pay property taxes and vacancy insurance, others who already hold notes may be looking for ways to liquidate capital and reinvest it elsewhere. Having a resource that can connect them with a note buyer is immensely helpful for financial professionals looking to provide their clients with all available options.
The benefits of seller financing can be far reaching in the professional world. Many service professionals stand to benefit from understanding this method of property sale. So, having an ‘insider’ at your fingertips is a must in order to provide clients with every available option.